New Microsoft Link to Consumer Electronics, Content

By Andrew Simons (January 7, 2007)

LAS VEGAS -(Dow Jones)- Microsoft Corp. (MSFT) Chairman Bill Gates unveiled a cadre of new products and services Sunday night that he says will allow consumers to integrate their electronic products.

The new offerings are mostly connected with Vista, the software maker's latest version of its Windows operating system.

"This is by far the most important release of Windows," Gates said in his keynote. "It's also the highest quality."

During a speech kicking off the Consumer Electronics Show, the industry's annual confab in Las Vegas, Gates said consumers will have more connected experiences from their gadgets. The speech marks Gate's 11th appearance at the show.

Microsoft, which has aggressively pursued the consumer market with products such as its Zune digital music player and Xbox 360 game console, aims to play a big part in a wave of consumer dollars going towards electronics.

The company provided an update on sales of the Xbox 360. Microsoft said it has sold 10.4 million Xbox 360 consoles to date, and expects to sell 1 million Zune music players by June.

The show is expected to draw 140,000 people over four days.

Attendees received a peek at Windows Vista, which included more bells and whistles than the current version of Windows.

Among the products Gates presented is a line of new personal computers running Microsoft Vista, which will be available this month. Gates showed computers from Sony Corp. (SNE), Hewlett-Packard Co. (HPQ), Toshiba Corp. (6502.TO) and Medion AG (MDN.XE). The PCs have various new features, including touch screens and improved wireless connections.

Gates also showed progress on a new device the software maker is working on with HP CP called Windows Home Server. The device acts as a hub for a home with multiple electronic devices.

"This is for homes with multiple PC's or Xboxes," said Gates.

The device is due from HP in the second half of the year.

Gates also introduced a slate of services including a variety of Internet portals and features designed onto Vista, which he said will allow easier connections to entertainment content.

The services include what the company calls Windows Media Center Sports Lounge, a venture with Fox Sports, a division of News Corp. (NWS). It will allow viewers to check sports news, scores, statistics, and video coverage.

The services also include what the company calls MSN Soapbox, which allows users to upload and share personal videos. The idea could be similar to YouTube, which swept the Internet last year.

Other services include a NASCAR Motorsports content portal, which the company said will allow fans of auto racing to browse, sample, and purchase content; TurboNick on Windows Vista, allowing users to see content from the Nickelodeon channel on a personal computer or television; Showtime Interactive, which allows users to browse and view Showtime programming; and Vongo, a service that allows unlimited access for $9.99 a month to more than 1,000 movies and 2,200 total video selections, including concerts, television shows and live streaming programs.

Gates also unveiled Sync, a product which allows users to connect personal electronics - including mobile phones, portable storage devices and portable music players - to an automobile.

Sync will be included as an option in 12 cars from Ford Motor Co. (F) in the 2008 model year, including cars from Lincoln and Mercury, starting this fall. Under the deal, the option will expand to all Ford models by 2009.

"Our ambition is for you to have connected experiences 24 hours a day," Gates said.

This address had been rumored to be Gate's final speech at the trade show, but Microsoft confirmed that it won't be the last. Gates said last June that he will move to a part-time role at the company in July 2008.

Copyright (c) 2007 Dow Jones & Company, Inc.